Politics

Biden announces ban on Russia oil, natural gas

President Biden on Tuesday announced a ban on the importation of Russian oil and natural gas in an effort to ramp up economic pressure on Russian President Vladimir Putin for invading Ukraine.

“This is a step we are taking to inflict further pain on Putin, but there will be costs here in the United States as well,” Mr. Biden said in remarks from the White House. “Defending freedom is going to cost us as well.”

The U.S. is the first country to prohibit the import of Russian oil.  European Union officials announced Tuesday that they would reduce their reliance on Russian oil but stopped short of a full ban, which would impose greater hardships for Europeans who rely more heavily than Americans on Russian energy.

“We are moving with this ban, understanding that many of our European allies and partners may not be in a position to join us,” Mr. Biden said. “We are a net exporter of energy so we can take this step when others cannot.”

The embargo, which is expected to cause already record-high gasoline prices to soar even higher, will come in the wake of mounting bipartisan pressure on Capitol Hill that forced the White House to reverse its position on a ban over concerns about increased consumer costs.
 

Members of both parties last week introduced legislation to ban Russian oil, and the measure quickly gained widespread support. Leaders in the House and Senate said the ban could be taken up this week.

The move marks a reversal in policy for the Biden administration, which had resisted bipartisan calls to escalate punishments against Moscow.

As Russia escalated its assault on Ukraine by targeting civilian areas amid accusations that it is committing war crimes, the administration has taken a more serious look at the ban.

In a video call with U.S. lawmakers on Saturday, Ukrainian President Volodymyr Zelenskyy urged them to support a ban on Russian oil imports.

White House press secretary Jen Psaki on Monday appeared to signal that a Russian oil ban could be coming.

Ms. Psaki told reporters that “no decision has been made at this point,” but also acknowledged internal discussions with European countries about the ban.

Meanwhile, British Prime Minister Boris Johnson on Tuesday was reportedly preparing his own plan to cut Britain’s dependence on Russian energy.

According to the American Fuel and Petrochemical Manufacturers, Russia in 2021 represented 3% of total U.S. crude oil imports and 1% of the total crude oil produced by U.S. refineries. Canada, Mexico and Saudi Arabia accounted for more than three-fourths of U.S. crude oil imports.

Russian oil and natural gas exports constitute a much larger share of the total energy mix for several Western European markets.

Earlier Tuesday, the European Union outlined plans to cut Russian gas imports by 75% this year and eliminate its dependence on Russia for energy by 2030.

Russia’s energy exports make up half of its economy, and oil is the U.S.’ largest import from the country.

Administration officials have argued that a Russian oil ban would reduce supply and raise prices at the gas pump for Americans.

A Quinnipiac University poll this week found that 71% of Americans would support a ban on Russian oil, even if it meant higher gasoline prices in the U.S.

Mr. Biden acknowledged that gas prices will increase as a result of the ban. He vowed to do everything he can to minimize the impact, but also warned oil and gas companies against taking advantage of the situation.

“Russia’s aggression is costing us all. And it’s no time for profiteering or price gouging. I want to be clear about what we’ll not tolerate,” he said.

The national average price for regular gasoline has topped $4 a gallon for the first time in more than a decade. It’s fast approaching the all-time high for the national average price of $4.11, which was set on July 17, 2008, according to the AAA automobile owners club.

After briefly reaching nearly $140 a barrel in spot trading earlier this week, the price of the benchmark Brent crude was trading at a still-elevated $132 a barrel in early Tuesday trading.

Republicans welcomed Mr. Biden‘s announcement but urged him to address the supply shortage by boosting U.S. oil production. They said looking to other countries, including Iran and Venezuela, for oil would be a mistake. 

“President Biden and the United States need to unleash American energy production and stop funding Putin’s ruthless war chest,” said Sen. Steve Daines, Montana Republican.

Sen. Marco Rubio, Florida Republican, said he was “happy” that Mr. Biden imposed the ban, but called on the president to ramp up production in the U.S.

“We can easily replace [Russian oil] by producing 200,000 a day of our own oil. We can easily do that very quickly,” Mr. Rubio said.

The oil ban is the latest sanction imposed against Russia in response to its invasion of Ukraine, which began 12 days ago. Mr. Biden has sanctioned a list of Russian oligarchs, politicians and even Russian President Vladimir Putin. He has also targeted some banks in connection with Russian allies.

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